Employment tribunal figures: 2013 update

14 November 2013 – Have you seen a reduction in Employment Tribunal claims?

Recently the Ministry of Justice has published information concerning the number of Employment Tribunal claims received since the introduction of fees for issuing claims.

The report is not a full analysis (which the tribunal publish officially) but, rather, an ad-hoc statistical release on tribunal claims received between July and September 2013, following the introduction of fees on 29 July 2013. However, there are some interesting findings which include:

The normal average number of tribunal claims received by the Tribunal each month is around 17,000;

As for June and July, the figures averaged out at 21,000 (which suggests there was a spike in people lodging claims before the fee regime was introduced); and

In August 2013 there were 7,000 tribunal claims received and 14,000 in September 2013, which suggests that the number of tribunal claims being lodged has reduced following the introduction of fees. What is even more interesting is that the number of single claims has dropped significantly (these figures can often be distorted by large equal pay claims where lots of claimants lodge their claim together – known as a multiple claims).

These statistics certainly bear out in our experience of the number of claims that we are dealing with on behalf of clients. However, employers cannot run out to celebrate just yet as we have heard from a number of sources that there is a backlog of cases waiting to be dealt with at the central processing centre in Leicester and so it is possible that these cases may well be waiting to make their way over to unwitting respondents – we are only likely to get a true picture of the impact of the fee regime once we receive the next set of figures next year.

29 May 2013 – Tribunal fees implementation date announced

HM Courts & Tribunal Service has announced that Claimants wanting to bring a claim at the employment tribunals (ET) or an appeal at the Employment Appeal Tribunal (EAT) will have to pay set fees from Monday 29th July 2013.

Under the Fees Order and supporting rules, the only way Claimants can avoid having to pay a fee upfront is by providing an application for fee remission against that fee under the HM Courts & Tribunals Service remissions scheme.

This is a significant sea change for the employment tribunal system, where previously no fees have been payable to make a claim. The new system is likely to deter claims from employees who are unable or unwilling to pay a fee when the outcome of their case is uncertain.

16 May 2013 – The remission system – how will it work in practice?

Did you know that the Government is introducing a fee scheme whereby the Employment Tribunal will start to charge Claimants for bringing a claim at the Employment Tribunal?

The Government has now decided that this will start from the end of July 2013.

Once the new proposals are implemented, it means that Claimants will have to pay up to the following amounts in order to attempt to bring a claim and see it through to a hearing at the Employment Tribunal:

Claim type

Amount

Type A

£390

Type B

£1,200

The appeal of a decision of the Employment Tribunal

£1,600

As you can see these are quite hefty sums of money, which is good news for employers as it means that (hopefully) the new scheme will act as a deterrent to employees bringing bogus Tribunal claims. It is hoped that it will also strongly encourage Claimants to reconsider any rash or disgruntled decision they may take to appeal an unsuccessful outcome made at the Employment Tribunal.

However, you need to be aware that the Government wants to protect Claimants who cannot afford to pay any or part of the new Employment Tribunal fees. To do this it proposes to extend existing law applicable to the civil court process to Employment Tribunals and the Employment Appeal Tribunal. This is called a remission service.

Basically, there will be a new system for assessing whether an individual is eligible for a free fee remission. This is now split into two distinct tests as follows:

Disposable capital test

The first limb of the test involves looking at an individual’s disposable household capital, including any savings and investments they may have.

The proposal is that an individual will qualify for a remission if they have less than the disposable capital limit as follows:

Amount of fee

Disposable capital limit

Up to £1,000

£3,000

£1,001 – £4,000

£8,000

More than £4,000

£16,000

Income test

If an individual passes the disposable capital test then the next test is to consider whether based on their income they should receive a full fee discount, make a partial contribution to their fee or pay the full fee. The remissions system could mean that an employee does not have to pay anything at all and can bring their claim for no fee at all.

There will be no fee payable if an individual is in receipt of any qualifying benefits which are as follows:

Income support

Working tax credit

Income-based job seekers allowance

Guarantee credit

Income-related Employment Support Allowance.

There will be no fee payable if an individual’s gross annual income is a below a certain amount depending on how many children that person has and whether or not that person is single. See the below table for more information on income rates used for the remissions system:

Number of children of party

Single

Couple

No children

£13,000

£18,000

1 child

£15,930

£20,930

2 children

£18,860

£23,860

3 children

£21,790

£26,790

4 children

£24,720

£29,720

5 or more children

As per 4 children plus the sum of £2,930 for each additional child i.e £30,580 for a single parent with 6 children

Conclusion

The disposable capital test helps employers. Without this element of the test, more people who have recently become unemployed, and are bringing their claim at the Tribunal, would qualify for remission based on income alone.

A final reflection… A good example is to think of an employee who has been dismissed and claims unfair dismissal. It may cost up to £1,200 to pursue an unfair dismissal claim and a dismissed employee with only £3,000 in savings and no household income would have to gamble over a third of their savings on tribunal fees at a time when they need the money the most in order to live. Statistics show that the average unfair dismissal award during the year 2012 was £4,500. Consequently, many dismissed employees may simply decide that access to justice is an expensive luxury they cannot afford.

The maximum Statutory Guarantee Payment for periods of lay off increases from £23.50 a day to £24.20 a day. The maximum over any 3 month period increases from £117.50 to £120.00.
If you are facing a Tribunal claim from a disgruntled employee, the team are happy and willing to help you through the whole Tribunal process.

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